How long has an employer got to reclaim "overpaid" salary

[Jaydee]

My employer paid me whilst i was on sick leave and on my managers discretion, it was either ssp, half pay or full pay. He agreed to pay me full pay and hence i received full wages for best part of a month. Shortly afterwards, i parted company on bad terms. This was in 2001. Nearly a year later, i was contacted asking for this overpayment of sick pay. I explained the situation about the payment at the mangers discretion etc, and thought the matter was closed. I recently received a small claims court summons requesting the overpayment plus interest plus costs. This is now 3 1/2 years later. Is this right? Considering i was given full sick pay at the time anyway? Can anybody shed any light on what my rights are here.

Many thanks

[andy hughes]

It does sound like they are 'chancing' it to me, but you need proper advice. Try a local solicitor - some offer an initial consultation free, or at a reduced rate, and they will know where you stand. If you don;t mind waiting, your local Citizens' Advice Bureau will help, but they are busy, so be prepared for a wait.

[Hgrove]

Agree with above, contact a Law Centre (ask the CAB to direct you to one).

[Hgrove]

P.S. Re. the Law Centre, as far as I know they work on the basis that you turn up, queue up, and you are seen in order of arrival.  At least one I used worked on that basis.  So, I suggest you turn up early, you could be seen straight away.

[Peter Pedant]

when I was overpaid, like a wimp I paid it back.

You need to check if they can't just take it out of the salary. Tht may be part of your employment contract

I think there is a defence in the Wages Act, that you have received it in good faith, and relied on it as a wage and spent it. And finally......you cd negotiate its repayment, because you are strapped for cash at �1 per week.

AS everyone has said, you need advice from the C A B and not from us!

[Maud]

The summons issued against you is well within time, so you can't escape that way. Regarding your rights you can (1) ignore it (2) pay up, or (3) defend. What it will not do is go away. If you ignore, then Summary Judgement against you will be obtained within days, if you defend the case will be on the Fast Track with 2 or 3 directions hearings at least before trial. There are no legal points in this, the trial is informal, your opponents make their pleadings, you yours, you both cross examine each other, the Judge decides. Be aware (a) that the rules changed in March so that if your opponents use a solicitor and the Judge finds against you he will add their solicitors costs to your bill, and (b) that a civil case does not preclude a criminal case against you under the Theft Acts 1968 and your opponents have a further almost 3 years in which to launch this.

[Hgrove]

Having read Jaydee's msg, it seems to me that the company did not pay this money by mistake.  It seems to me that they exercised their discretion to pay in full.  Hence it seems to me that you should defend the case, provided you have letters/documents etc. that can support your case that they voluntarily paid you in full during your illness.  Otherwise, however dishonest on their part, they could claim they made a genuine mistake at the time and should now get money back.

[Maud]

If Jaydee has decided to defend then let us hope that your analysis is correct, Hgrove. If he has, however, Jaydee will never ever again be able to settle for the lesser amount of the summons, and remember that nothing is admitted by paying the summons. The rules for Ltd Co's and PLC's require legal representation in Court, although the Judge can waive this for very small Ltd's. Prior to March of this year no legal cost's were recoverable in the Small Claims Court. This, obviously, was very unfair to the larger Ltd's and PLC's, who, to recover any amount had to spend at the very least �2500-�3000. People could steal up to �2000 or �3000 with the almost certain knowledge that they would not be persued through the civil courts. Since March all that has changed, this is why his opponents have come after Jaydee, who, if �2000 is missing is now looking at a summons including costs and interest of say �2650.

[Maud]

(continued)

Under the new rules if he loses then the final bill will be considerable. It will be something along the lines of �2650 + say, 4 directions hearings @ �500 ea = �2000, + 3 meetings with barrister (a barrister is necessary to appear before a Judge) + preparation = 4 x �500 = �2000 + barrister and solicitor at trial = �1500 + �500 sundry disbursements + VAT on �6000 = �1050 which totals to �9700 at the very least. I stress at the very least, because quite often there can be as many as 20 directions hearings before trial, all at �500 + VAT, and quite often the Judge asks for a meeting with all parties before trial including barrister which incurrs a further �1500 + VAT, and all of this requires further costs and disbursements @, say, �500 + VAT. On top of which Jaydee's life will become a misery for 6 - 12 months.. 

[Hgrove]

I have to say that Maud's msg is very worrying.  I have had very few days' sick leave in my working life, but I have always been paid in full despite the fact that sick pay was always said to be at the employer's discretion in the staff manual.  Now I gather that any of my previous employers (for the past 12 years presumably?) could now come after me asking for their money back???  I do not have any letters from my line managers telling me they were paying me in full despite the fact that I was off sick.  Does that mean that I am in danger?  Beyond that, I find it difficult to follow Maud's latest two messages because they are a bit technical for me.  It certainly sounds inequitable, not to say dishonest, to agree to pay an employee in full, and then decide to try to claw it back years later...  I am currently a housewife with no income or savings of my own so what would I do if my employer from 12 years ago decided to pursue me???  I could not afford to pay it back so I'd have to defend it presumably???

[Maud]

In point of fact any over-payment - payroll, bank, other - can be claimed back within six years of its discovery. So, yes, if you did not write a letter at the time thanking them for their kindness in exercising their discretion in your favour and keep a copy on your employment file, yes, someone could come along later and claim overpayment. However, in the case of Jaydee if you read his post again you will see that shortly after return to work he parted company on bad terms, and this was, I suspect, through being asked to return the money to which he was not entitled and him refusing to do so.